BERLIN (AP) -- Germany's unemployment rate increased to 8.6 percent in March as the global economic crisis tightened its grip on Europe's biggest economy, government figures showed Tuesday.
The unadjusted jobless rate rose from 8.5 percent in February, the Federal Labor Agency said. A total of 3.586 million people were out of work, an increase of 34,000 compared with the previous month.
"The economic downswing is increasingly having an impact on the labor market," labor agency chief Frank-Juergen Weise said.
In recent years, Germany's jobless rate would typically decline during the month of March.
The seasonally adjusted unemployment rate increased to 8.1 percent from 8 percent in February, with 69,000 more people out of work -- up from a 50,000 increase in February and the fifth straight monthly increase.
Weise said companies' use of short-time work agreements to soften the impact of the crisis continued to have a stabilizing effect.
Labor agency board member Raimund Becker said the number of people registering for such arrangements in March was between 680,000 and 740,000 -- compared with just over 700,000 in February and some 291,000 in January.
Germany, the world's biggest exporter, went into recession in last year's third quarter as the economic crisis eroded global demand for its products.
Analysts have forecast that its economy will shrink by between 3 percent and 7 percent this year.
The government forecast in January that it would contract by 2.25 percent -- already easily the worst performance since World War II -- but has since conceded that it will have to revise the figure downward.
"Export and investment demand are both suffering very sharply and will continue to do so throughout 2009," said Timo Klein, an economist at IHS Global Insight in Frankfurt. "Unemployment will therefore now remain on a strongly rising trend until well into 2010."
"The worsening of credit conditions for nonfinancial companies will increasingly spark layoffs as firms are either forced to cut costs elsewhere or even forced into bankruptcy," he added in a research note.